Bitcoin is Flowing Out of Cryptocurrency Exchanges
After setting a price record in mid-March, Bitcoin has entered a prolonged consolidation phase. During this period, the total balance on cryptocurrency exchanges has decreased by 5%, dropping to 2.85 million BTC. This reduction is primarily due to Bitcoin being moved to cold wallets, indicating high expectations for further Bitcoin growth.
Accumulation by Young Whales
Notably, young whales have shown significant activity in accumulating Bitcoin. These investors are adding approximately $1 billion worth of Bitcoin to their wallets daily. Ki Young Ju, the head of the analytics firm CryptoQuant, notes the striking similarity in their behavior to 2020. Back then, Bitcoin consolidated around $10,000 for about six months before its price surged 2.5 times within three months.
Institutional Investment Surge
Key representatives of these young whales include large institutional investors from the United States. Thanks to the 13F filings, it has been revealed that one-third of all capital inflow into spot ETFs in the first quarter ($4 billion) came from companies with assets under management exceeding $100 million.
Moreover, major players are just beginning to get a taste for Bitcoin. David Krause, a finance professor at Marquette University, believes that the State of Wisconsin Investment Board (AUM: $156 billion) is currently gauging public opinion following its first-quarter purchase of $150 million in BlackRock and Fidelity fund shares. If the response is positive, Krause is confident that investments in cryptocurrency will increase and that other pension funds will follow the State of Wisconsin Investment Board’s example.
Growing ETF Volume
The volume of American ETFs continues to rise, currently reaching $14.1 billion. This growth underscores the increasing institutional interest and investment in Bitcoin, further supporting the potential for significant price increases in the near future.
Favorable Conditions for Bitcoin Growth
Interest in cryptocurrency from institutional capital and the renewed outflow of coins to cold wallets create a favorable environment for further Bitcoin growth. The next potential catalyst is the review of Franklin Templeton’s application for a spot ETH ETF, with the final decision due on June 11.
According to a recent statement by Ki Young Ju on his X channel, Bitcoin is not currently overvalued based on its network fundamentals.
